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Friday, September 23, 2016

Jesus said to his disciples, “A rich man had a steward who was reported to him for squandering his property. He summoned him and said, ‘What is this I hear about you? Prepare a full account of your stewardship, because you can no longer be my steward.’The steward said to himself, ‘What shall I do, now that my master is taking the position of steward away from me? I am not strong enough to dig and I am ashamed to beg. I know what I shall do so that, when I am removed from the stewardship, they may welcome me into their homes.’ He called in his master’s debtors one by one.To the first he said, ‘How much do you owe my master?’He replied, ‘One hundred measures of olive oil.’He said to him, ‘Here is your promissory note. Sit down and quickly write one for fifty.’Then to another the steward said, ‘And you, how much do you owe?’He replied, ‘One hundred kors of wheat.’The steward said to him, ‘Here is your promissory note; write one for eighty.’And the master commended that dishonest steward for acting prudently. “For the children of this world are more prudent in dealing with their own generation than are the children of light. I tell you, make friends for yourselves with dishonest wealth, so that when it fails, you will be welcomed into eternal dwellings. The person who is trustworthy in very small matters is also trustworthy in great ones; and the person who is dishonest in very small matters is also dishonest in great ones. If, therefore, you are not trustworthy with dishonest wealth, who will trust you with true wealth? If you are not trustworthy with what belongs to another, who will give you what is yours? No servant can serve two masters. He will either hate one and love the other, or be devoted to one and despise the other. You cannot serve both God and mammon.”-------------------------------------------------------------------------------Commentary by Don SchwagerHow can a bad person possibly give good example? Jesus obviously thought that the example of a rascal would be a perfect illustration for a spiritual lesson about the kingdom of God! What's the point of Jesus's parable? The dishonest steward is commended for his shrewdness. The original meaning of "shrewdness" is "foresight". A shrewd person grasps a critical situation with resolution and foresight. Jesus is concerned here with something more critical than a financial crisis. His concern is that we avert spiritual crisis through the exercise of faith and foresight. If Christians would only expend as much foresight and energy to spiritual matters which have eternal consequences as much as they do to earthly matters which have temporal consequences, then they would be truly better off, both in this life and in the age to come. Ambrose, a 4th century bishop said: The bosoms of the poor, the houses of widows, the mouths of children are the barns which last forever.True wealth consists not in what we keep but in what we give away. Possessions are a great responsibility. The Lord expects us to use them honestly and responsibly and to put them at his service and the service of others. We are God's servants and all that we have belongs to him. He expects us to make a good return on what he gives us. God loves generosity and he gives liberally to those who share his gifts with others. The Pharisees, however, had no room for God or others in their hearts. The gospel says they were lovers of money. Love of money and wealth crowd out love of God and love of neighbor. Jesus makes clear that our hearts must either be possessed by God's love or our hearts will be possessed by the love of something else. What does your heart most treasure?

Wells Fargo’s longtime chief executive John Stumpf endured more than two hours of pummeling Tuesday on Capitol Hill over a scheme in which bank employees created millions of sham accounts to meet aggressive sales goals.

“I have often said that banking is based on trust and that trust was broken at Wells Fargo,” Sen. Richard C. Shelby (R-Ala.), chairman of the Senate Banking Committee, said during the hearing.

Stumpf, who has been at Wells Fargo for more than 30 years, repeatedly apologized for letting down customers. But the questioning was often tense, and Stumpf was interrupted and chastised by lawmakers for not catching the problem sooner.

“I am deeply sorry that we failed to fulfill our responsibility to our customers, to our team members, and to the American public,” Stumpf told the committee. “I have been with Wells Fargo through many challenges, none that pains me more than the one we will discuss this morning.”

The San Francisco-based bank has been in lawmakers’ crosshairs since being fined $185 million earlier this month after thousands of the bank’s employees created up to 2 million fake accounts — from credit cards to checking accounts — to meet sales goals. In some cases, bank customers faced various fees for accounts they didn’t request, or bank employees took money from an authorized account to create a fake one.

Wells Fargo fired 5,300 employees between 2011 and 2016 for the scheme, including some managers and “one area president,” Stumpf said. The bank will review whether the conduct could have occurred before 2011, he said. “We don’t want to leave any stone unturned,” Stumpf said.

But that was not enough for many members of the committee, who grilled Stumpf for details about the scheme and repeatedly expressed astonishment that senior management allowed problems to fester for so long without taking more assertive action.

In one tense exchange, Sen. Elizabeth Warren (D-Mass.) demanded that Stumpf explain why he had not offered to give up any of his compensation — he made $19 million last year — or resigned in the wake of the scandal. She noted that Stumpf repeatedly touted Well Fargo’s ability to sell more and more products to customers in quarterly calls with analysts, and then watched as investors pushed up the bank’s stock price, generating gains that increased his own holding by about $200 million over several years.

“Evidently your definition of accountable is to push the responsibility” to low-level, low-wage workers, Warren said. “It is gutless leadership. You should resign; you should give back the money.”

Stumpf stumbled while trying to respond to Warren.

Wells Fargo’s case has become a new flash point in the debate over whether, eight years after the Great Recession, U.S. regulators are doing enough to hold Wall Street accountable for bad behavior.

“There is simply no place for this kind of outrageous behavior in America,” Democratic presidential candidate Hillary Clinton said in a letter to Wells Fargo customers Tuesday. “Our economy depends on a strong and safe banking system to help keep it moving. But even after Americans spent years working hard to recover from the Great Recession, the culture of misconduct and recklessness that preceded that crisis too often persists.”

During the hearing, Stumpf faced tough questioning from lawmakers about whether the company’s top executives should return some of their bonuses over the misconduct. In particular, lawmakers took aim at Carrie Tolstedt, the former head of the company’s community banking unit.

Tolstedt was told that the company was “going in a different direction,” in part because of the misconduct discovered in her unit, Stumpf said. Tolstedt opted to retire in July. But lawmakers were peeved by reports that Tolstedt, a 27-year veteran of the bank, could leave with more than $100 million in compensation. Tolstedt and other top executives should be forced to give back some of their compensation, they said.

“So, 5,300 team members, earning perhaps $30,000 a year, have lost their jobs, while Ms. Tolstedt walks away with $100 million, give or take,” said Sen. Sherrod Brown (D-Ohio), the ranking minority-party member of the committee. “Despite firing thousands of team members, Ms. Tolstedt seemingly decided it was not important enough to alert the head of the company or the board of directors or anyone else for two years, if ever, even though you both sat on the bank’s board.”

The company’s board is reviewing whether senior executives will face “clawbacks” of their compensation, Stumpf said. Though chairman of the board, Stumpf said he is not part of that discussion, which is being handled by a compensation committee.

Stumpf told lawmakers that he learned of the misbehavior in 2013, but acknowledged the bank did not act quickly enough to remedy the problem. “I want to apologize for violating the trust our customers have invested in Wells Fargo,” Stumpf said. “And I want to apologize for not doing more sooner to address the causes of this unacceptable activity.”

Monday, September 19, 2016

(Vatican Radio) It was another lesson in the economic thought of Pope Francis. In an audience with members of the Confederazione Cooperative Italiane (confederation of Italian co-operatives) on Saturday [2/28/2015], Pope Francis gave the 7,000 people present five practical suggestions for their mission in the context of the current “throwaway culture.”First, the Pope said, co-operativesmust continue to be “the motor that uplifts and develops the weakest parts of our local communities and civil society.” [Note: There has been a movement in a number of U.S. states after the 2008 financial meltdown to allow for Benefit Corporations which could be a better alternative over the current forms we now have. A Benefit or B-Corporation is different from a Cooperative Corporation.]The first priority is to establish new co-operatives, while developing existing ones, so as to create new employment opportunities, especially among youth, he said.Second, the Pope urged the co-op movement to be a “protagonist” in proposing new welfare solutions, particularly in the area of healthcare. As a third point, he spoke of the economy and its relationship with social justice and human dignity. Speaking of the need to “globalize solidarity,” he urged the confederation to bring co-operatives to the “existential peripheries” and to continue to be “prophetic” by “inventing new forms of co-operation.” The Pope spoke of “a certain liberalism,” which “believes it is first necessary to produce wealth—and it does not matter how—to then promote some state redistribution policy.”Others think it is up to a company to “bestow the crumbs of accumulated wealth” to those in need to then, in turn, “absolve themselves” of “their so-called ‘social responsibility’,” the Pope said.“You run the risk of deluding yourself that you are doing good while, unfortunately, you continue only to do marketing,” without ever escaping the “fatal loop” of egoism, “which has the god of money at the centre,” he said.Instead, the co-operative creates a “new type of economy” that allows “people to grow in all their potential,” socially and professionally, as well as in responsibility, hope and co-operation, he said. The Pope clarified that while he was not saying income growth is not important, it certainly “is not enough.”Fourth, he said, the co-operative movement can exercise an important role in sustaining, facilitating and encouraging family life, by insisting on work-life balance, which would “help women to realize fully their own vocation and to put into practice their own talents.”In this way, he said, women are “free to be always greater protagonists, whether at work or in families.”Fifth, where few resources exist to start up new projects, the Pope urged the co-op movement to “invest well,” in particular by putting together “good resources to realize good works.” He urged more collaboration among credit unions and co-op businesses and the establishment of resources “for families to live with dignity and serenity.”He also warned against money becoming an idol, citing St Francis of Assisi in calling it “the devil’s dung.”“When money becomes an idol, it controls man’s choices,” he said. “It makes him a slave.”He exhorted the co-operative movement to join the global economy to promote both "an economy of honesty" and "a healing economy." He urged them to exercise “the courage and the imagination to build a just path, so as to integrate development, justice and peace in the world.”He concluded by calling on the members of the Catholic confederation to maintain their Catholic identity and values in their current collaboration with other co-op groups in creating a large national association.“Live your alliance (with these other groups) as Christians, as a response to your faith and identity, without fear. Faith and identity at the base,” he said.“And this is also a Christian call to all,” he continued off-the-cuff. “Christian values not only for ourselves. They are to be shared. Share them with those, who do not think as we do but who want the same thing that we want.”Italy's church-based co-op movement began in the late 19th century, inspired by the encyclical Rerum Novarum, written by Pope Leo XIII. The Confederazione Cooperative Italiane was first founded in 1919. It was suppressed by the Fascist Regime and re-established in 1945.

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Because we are all tempted to sacrifice our souls for profit, power, position, prestige, privilege, promotions, popularity, pride, prejudice, politics, prosperity, possessions, or pleasures. So by changing our paradigms, we can become the best versions of ourselves and help make our world a better place to live.

In this blog, we highlight bad practices using examples from current and past events, then we show what the better choices are. This is not to show that good always triumphs over evil, but only to show that better exists and that it's possible for people to operate in the better way. The history of business and how we grew to where we are gives us a perspective that things have been just as bad in the past and eventually got better, so there's still hope that things will cycle to the “better” yet again. We believe this blog is part of pushing the rope of improvement up the hill of progress. If you are dissatisfied with the status quo and looking for a better way to live and work, then bookmark our blog and follow us by email.

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BRYAN J. NEVA, SR. is a writer and electronics engineer from San Diego, California. He served as a Hospital Corpsman in the Navy during the Cold War and early War on Terror. He subsequently earned a BSEE and MBA degree from Old Dominion University, and then went on to work in the defense, medical device, and aerospace industries. A convert to Roman Catholicism, Bryan is a strong proponent of Catholic Social Justice and Economic teachings akin to conscientious capitalism and responsible, servant leadership. From his diverse background, he has a counterintuitive view of business management that values people over profits and the needs of the many over the wants of the few.

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ALLEN F. LAUDENSLAGER, JR. is a semi-retired writer from Seattle with a business and management background spanning over fifty years. After serving in the Army in Vietnam, he went on to work as an assembly line worker, a foreman, an electrician, a cabinetmaker, a small business owner, an electronics technician, a supervisor, a manager, a senior project manager, and a technical writer. With the knowledge and experience he has gained over a lifetime, he brings an insightful view of life, business, and management in today's global markets.